Bone is an amazing structure consisting of two nested organ systems-the bony skeleton and the bone marrow. The bone marrow environment includes niches for fostering stem cells for several lineages including hematopoietic stem cells (HSC) and mesenchymal stem cells (MSC). Skeletal stem cells appear to be derived in part from the stromal component of the bone marrow. MSC give rise to both bone marrow stromal cells, which regulate the bone marrow microenvironment by providing factors such as Kit ligand, that required for maintenance of HSC, and to progenitors for bone, cartilage and fat. Several recent lines of evidence indicate that matrix metalloproteinases (MMPs), particularly MMP-9, regulate the bone marrow stromal microenvironment. MMP-9 is upregulated after myeloablation, as well as after skeletal injury, and is required for efficient mobilization and regeneration of HSC, on one hand and the recruitment and fate of osteoprogenitor cells, on the other hand. Mobilization of both HSC and bone progenitors depends on MMPs and occurs in response to VEGF. We propose to study which cell populations in the bone marrow microenvironment make MMPs, the relationship of MSC and the bone marrow stromal cells that maintain HSC and how MMPs may contribute to the distinct properties of these cells. We will exploit the fact that MSC differentiate to mesenchymal fates when the skeleton heals by generating new bone. We will use a genetic approach to investigate the role of MMPs using MSC and stromal cells isolated from bone marrow of mice with targeted mutations in MMPs. We propose to assess the contribution of bone marrow MSC to skeletal repair and ask what role MMP-9 plays by investigating migration and differentiation of skeletal regeneration after injury. We will determine the specific contribution of these cells to skeletal regeneration by implanting genetically labeled stromal cells/MSC into a fracture defect. We will assess their potential to differentiate into cartilage and bone. We will simultaneously detect transplanted marrow cells and low-level mRNA expression patterns within the complex environment of an adult fracture callus. This technique will allow us to follow the fate of bone marrow-derived cells as they participate in the different stages of bone regeneration. These studies will have direct implications for the treatment of skeletal injuries resulting from disease or malformation, and for injuries that are refractory to conventional therapy.